Net worth Update February 2018 $293,647 (+$16,897)

See all other net worth update here.

Net worth is up significantly (+$16,897) in February with standard income and low expense. This gives our family its highest saving rate ever.

We are giving up on % differential and will now use absolute values for net worth update. When we would say my account gained 2%, did it gain 2% of $100 (2$) or 2% of $100,000 ($2,000). Real values put numbers into perspective.

Net worth: $293,647 (+$16,897).

Incredible gain! It was expected because of the tax planning of last year. There was no mortgage payment in January, the expenses were low, past Christmas.

Let’s see how each account made.

Vanguard (401k): $61,233 (+$4,378)

We are maxing out the 401k again this year, so that’s $18,500 averaged over 26 paychecks. There’s 50% match (up to 2% of salary) match by my employer. This adds $173 to the account for each pay day. Finally, there was market gain in January leading to 4k gain.

Vanguard Brokerage: $50,729 (+$3,362)

High gain due to strong market return. We are adding $500 per pay day to my brokerage account with an automatic deposit. We need to increase this amount otherwise we end up with too much spare cash.

Vanguard Roth: $16,655 (+$5,318)

Each New Year starts with a new Backdoor ROTH contribution. In 2018, we can contribute $5,500 to an IRA. We then convert it to a ROTH. We have to do this process since our family income is too high to contribute directly to a ROTH IRA. Bonds are getting a negative return (-$200). I have an uneasy feeling about holding bonds due to the low interest rate of the global economy.

Vanguard Roth: $16,527 (+$5,309)

Similar to above. This a spousal Backdoor ROTH. The strategy is the same, we contribute $5,500 to an IRA under her name, and then a few days later, we convert it to a ROTH IRA so it get grow tax free!

Cash: $24,528 (-$3,397)

Cash Balance are too high. I was accumulating them for Bank Account and Credit Card churning which requires large deposit or large balance. We’ll see in the next few months how I’m able to achieve these and where the money will go.

Debt

Mortgage is not moving at $712,748. Car loan is down to $6,356 (-$163). And credit card debt are at $7,000, down from the high of $9,000 in December. I never carry a balance, these are just current total.

Leverage Ratio: 71.21% (-1.26%)

That one is staying as a %. 🙂 It’s close to the lowest it has ever been (70.43%). I’m looking forward to it crossing below 70% this year. Total liabilities are at $726,146 while assets are at ($1,019,749). I keep the home value at $840,000 and I’m not moving it. Home evaluation sites are saying it’s worth $900k now. That’s fine. Once we sell, we will have to some repair, home staging and commission. Let’s keep it conservative low. I’d rather be conservative and surprised, than optimistic and sorry.

Expenses are under control. There was another emergency family travel for $923 this month. Food is still incredibly expensive in high cost California ($1084), also, we got 3 hungry mouths to feed. 🙂

Total income (post-tax) was $11,835 and expense $4,287 for a saving rate of 68.45%.  This is the highest saving rate I ever had. For kicks and giggles, if the emergency travel wasn’t there, the saving rate would have been upwards 75%! We are also cheating, there was no mortgage payment on this month. The cumulative saving rate for the last 12 months is 41.31%, up 1% from 40.15%. One of my objective is to get it to 50% by end of year. We are expecting high saving rate for next month as well.

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